No. 27379 (Amendment): R414-304. Income and Budgeting

DAR File No.: 27379
Filed: 08/30/2004, 05:31
Received by: NL

 

RULE ANALYSIS

Purpose of the rule or reason for the change:

This rulemaking is needed to make certain changes in the income provisions to correspond with the changes in eligibility under the 1931 Family Medicaid program being submitted in Rule R414-303. It also is needed to make a change to Family-related Medicaid programs so that ineligible alien family members will be counted in the household size to determine the applicable income limit to use for eligibility of the U.S. citizen or qualified alien family members. (DAR NOTE: The proposed amendment to Rule R414-303 is under DAR No. 27378 in this issue.)

 

Summary of the rule or change:

The changes include: 1) a new subsection is added at the beginning of Section R414-304-4 to clarify that these rules apply to Family Medicaid programs; 2) in Subsection R414-304-4(15), language is being changed to clarify the type of financial assistance programs from the Department of Workforce Services, and language is being added that even though the cash payments under financial assistance payments will not count as income to determine Family Medicaid eligibility, household income used to determine the amount of such financial assistance payments will count; 3) in Subsection R414-304-6(2), the definition of "1931 Family Medicaid" is being changed to reference the definition found in Rule R414-303, and the definition of "Temporary Assistance to Needy Families" is being removed as it is no longer needed in this rule; 4) in Subsection R414-304-6(3), JTPA is being replaced with the name of the new program that replaced it; 5) in Subsection R414-304-6(4), the phrase "TANF financial payment" is being removed as that is no longer an eligibility criteria; 6) Subsection R414-304-13(2) is being added that will count nonqualified alien family members as part of the household size to determine eligibility for the U.S. citizen or qualified alien family members, and subsequent subsections have been renumbered; 7) in the new Subsection R414-304-13(3), wording has been added to make it clear that an ineligible alien child may be excluded by request of the applicant and by doing so the income and resources of that child will not be counted to determine eligibility for any other family members; and 8) in the new Subsection R414-304-13(9), clarifying language was added.

 

State statutory or constitutional authorization for this rule:

Title 26, Chapter 18

 

Anticipated cost or savings to:

the state budget:

A savings of $157,920 ($113,702 in federal funds and $44,218 in state funds) could be realized. This estimate could be less if these individuals can meet a spenddown to become eligible, qualify for a different Medicaid program, or enroll in the Primary Care Network. This savings will be offset by a potential increase in costs for individuals who will now qualify for Medicaid because of the change in counting ineligible alien family members in the household. The increase should be minimal, perhaps up to 50 individuals, most of whom will be children. The estimated annual cost for 50 children is $81,000 ($58,350 in federal funds and $22,650 in state funds).

 

local governments:

Local governments are not affected by this rulemaking as this only affects eligibility for individuals.

 

other persons:

It is difficult to estimate the costs individuals may incur who are not able to qualify for Medicaid because of the change to determine eligibility for 1931 Family Medicaid separately from eligibility for the Family Employment program. These individuals can receive some primary care services at community health centers. If they have no other medical coverage, their other medical costs would be equal to whatever medical expenses they incur during the year.

 

Compliance costs for affected persons:

Individuals who cannot receive Medicaid because of the change in determining eligibility for 1931 Family Medicaid and who have no other medical coverage will incur costs for their personal medical expenses. Medical providers may be affected if they provide services to these individuals and then cannot receive payment from these individuals.

 

Comments by the department head on the fiscal impact the rule may have on businesses:

These changes are being made at the request of the Department of Workforce Services. This will improve the efficiency and flexibility of their eligibility determination processes. The consequence is that an estimated 40 - 50 adults that may lose Medicaid eligibility. This will have an impact on these individuals and on their health care provider lasting until these individuals can obtain employer-based health insurance. Scott D. Williams, MD

 

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Health
Health Care Financing, Coverage and Reimbursement Policy
CANNON HEALTH BLDG
288 N 1460 W
SALT LAKE CITY UT 84116-3231

 

Direct questions regarding this rule to:

Craig Devashrayee at the above address, by phone at 801-538-6641, by FAX at 801-538-6099, or by Internet E-mail at [e-mail]

 

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

10/15/2004

 

This rule may become effective on:

10/16/2004

 

Authorized by:

Scott D. Williams, Executive Director

 

 

RULE TEXT

R414. Health, Health Care Financing, Coverage and Reimbursement Policy.

R414-304. Income and Budgeting.

R414-304-4. Family Medicaid and Institutional Family Medicaid Unearned Income Provisions.

This section provides eligibility criteria governing unearned income for the determination of eligibility for Family Medicaid and Institutional Family Medicaid coverage groups.

(1) The Department adopts 42 CFR 435.725, 435.726, 435.811 through 435.832, 2001 ed., and 45 CFR 233.20(a)(1), 233.20(a)(3)(iv), 233.20(a)(3)(v), 233.20(a)(3)(xxi), 233.20(4)(ii), and 233.51, 200[1]3 ed., which are incorporated by reference. The Department adopts Subsection 404(h)(4) of the Compilation of the Social Security Laws in effect January 1, 200[1]3, which is incorporated by reference. The Department shall not count as income any payments that are prohibited under other federal laws from being counted as income to determine eligibility for federally-funded medical assistance programs.

(2) The following definitions apply to this section:

(a) A "bona fide loan" is a loan that has been contracted in good faith without fraud or deceit and genuinely endorsed in writing for repayment.

(b) "Unearned income" means cash received for which the individual performs no service.

(c) "Quarter" means any three-month period that includes January through March, April through June, July through September or October through December.

(3) Bona fide loans are not countable income.

(4) Support and maintenance assistance provided in-kind by a non-profit organization certified by the Department of Human Services is not countable income.

(5) The value of food stamp assistance is not countable income.

(6) SSI and State Supplemental Payments are income for children receiving Child, Family, Newborn, or Newborn Plus Medicaid.

(7) If rental income is unearned income, deduct $30. If the rental income is consistent with community standards, additional deductions are allowed if the client can prove greater expenses. The following expenses in excess of $30 may be allowed:

(a) taxes and attorney fees needed to make the income available;

(b) upkeep and repair costs necessary to maintain the current value of the property. This includes utility costs.

(c) only the interest can be deducted on a loan or mortgage made for upkeep or repair;

(d) if meals are provided to a boarder, the value of a one-person food stamp allotment.

(8) Cash gifts that do not exceed $30 a quarter per person in the assistance unit are not countable income. A cash gift may be divided equally among all members of the assistance unit.

(9) Deferred income that was not deferred by choice is countable income when it is received by the client if receipt can be reasonably anticipated. If the income was deferred by choice, count it as income when it could have been received.

(10) The value of special circumstance items is not countable income if the items are paid for by donors.

(11) Home energy assistance is not countable income.

(12) Do not count payments from any source that are to repair or replace lost, stolen or damaged exempt property. If the payments include an amount for temporary housing, count only the amount that the client does not intend to use or that is more than what is needed for temporary housing.

(13) SSA reimbursements of Medicare premiums are not countable income.

(14) Payments from trust funds are countable income in the month the payment is received or made available to the individual.

(15) [FEP]Payments from the Department of Workforce Services under the Family Employment program, the Working Toward Employment Program[ payments], and the Refugee Cash Assistance program are not countable income. Income used to determine the amount of these payments is counted to determine eligibility for Medicaid, unless the income is an excluded income under other laws or regulations.

(16) Only the portion of a Veteran's Administration check to which the client is legally entitled is countable income.

(17) If the entitlement amount of a benefit differs from the payment, the full entitlement amount is counted as income unless the amount being withheld from the entitlement is due to an overpayment of such benefits, in which case the entitlement less the amount withheld to repay the overpayment is counted. If deductions are being withheld that are purely voluntary, or are to repay a debt or meet a legal obligation other than an overpayment of the benefit, the full entitlement is counted as income.

(18) Deposits to joint checking or savings accounts are countable income, even if the deposits are made by a non-household member. Clients who dispute ownership of deposits to joint checking or savings accounts shall be given an opportunity to prove that the deposits do not represent income to them. Funds that are successfully disputed are not countable income.

(19) Income, unearned and earned, [shall be]is deemed from an alien's sponsor, and the sponsor's spouse, if any, when the sponsor has signed an Affidavit of Support pursuant to Section 213A of the Immigration and Nationality Act on or after December 19, 1997.

(20) Sponsor deeming [will ]ends when the alien becomes a naturalized U.S. citizen, or has worked 40 qualifying quarters as defined under Title II of the Social Security Act or can be credited with 40 qualifying work quarters. Beginning after December 31, 1996, a creditable qualifying work quarter is one during which the alien did not receive any federal means-tested public benefit.

(21) Sponsor deeming does not apply to applicants who are eligible for Medicaid for emergency services only.

(22) The interest earned from a sales contract on either or both the lump sum and installment payments is countable unearned income when it is received or made available to the client.

(23) Interest accrued on an Individual Development Account as defined in [Sections 404-416 of Pub. L. No.105-285 effective October 27, 1998, shall not]42 USC 604(h) does not count as income.

(24) Current child support payments are countable income to the child for whom the payments are being made. If a payment is for more than one child, the amount is divided equally among the children unless a court order indicates a different division. Child support payments made for past months or years (arrearages) are countable income to determine eligibility of the parent or guardian who is receiving the payment. If ORS is collecting the child support, it is counted as current even if it is mailed late by ORS. Arrearages are payments collected for past months or years that were not paid on time and are like repayments for past-due debts. ORS may be collecting both current child support and arrearages.

(25) Payments from annuities count as unearned income in the month received.

(26) If income such as retirement income has been divided between divorced spouses by the divorce decree pursuant to a Qualified Domestic Relations Order, count only the amount paid to the individual.

 

R414-304-6. Family Medicaid and Family Institutional Medicaid Earned Income Provisions.

This section provides eligibility criteria governing earned income for the determination of eligibility for Family Medicaid and Institutional Family Medicaid coverage groups.

(1) The Department adopts 42 CFR 435.725, 435.726, 435.811 through 435.832, 2001 ed. and 45 CFR 233.20(a)(6)(iii) through (iv), 233.20(a)(6)(v)(B), 233.20(a)(6)(vi) through (vii), and 233.20(a)(11), 200[1]3 ed., which are incorporated by reference.

(2) The following definitions apply to this section:

(a) "Full-time student" means a person enrolled for the number of hours defined by the particular institution as fulfilling full-time requirements.

(b) "Part-time student" means a person who is enrolled for at least one-half the number of hours or periods considered by the institution to be customary to complete the course of study within the minimum time-period. If no schedule is set by the school, the course of study must be no less than an average of two class periods or two hours a day, whichever is less.

(c) "School attendance" means enrollment in a public or private elementary or secondary school, a university or college, vocational or technical school or the Job Corps, for the express purpose of gaining skills that [will] lead to gainful employment.

(d) "Full-time employment" means an average of 100 or more hours of work a month or an average of 23 hours a week.

(e) "Aid to Families with Dependent Children" (AFDC) means a state plan for aid that was in effect on June 16, 1996.

(f) "1931 Family Medicaid"[means a medical assistance program that uses the AFDC eligibility criteria in effect on June 16, 1996 along with any subsequent amendments in the State Plan, except that 1931 Family Medicaid eligibility for recipients of TANF cash assistance follows the eligibility criteria of the Family Employment Program] is Medicaid coverage required by Subsection 1931(a), (b), and (g) of the Compilation of Social Security Laws.

[ (g) "Temporary Assistance to Needy Families" (TANF) means a grant program providing financial assistance to eligible families with dependent children. It is also referred to as Family Employment Program (FEP).

] (3) The income of a dependent child is not countable income if the child is:

(a) in school or training full-time;

(b) in school or training part-time, if employed less than 100 hours a month;

(c) in [JTPA]a job placement under the federal Workforce Information Act (WIA).

(4) For Family Medicaid, the AFDC $30 and 1/3 of earned income deduction is allowed if the wage earner has received [a TANF financial payment or ]1931 Family Medicaid in one of the four previous months and this disregard has not been exhausted.

(5) [To]The Department determines countable net income from self-employment[, the state shall] by allowing a 40 percent flat rate exclusion off the gross self-employment income as a deduction for business expenses. [For]If a self-employed individual[s] provides verfication of actual business expenses[who have actual allowable business expenses] greater than the 40 percent flat rate exclusion amount, [if the individual provides verification of the actual expenses,]the Department allows actual expenses to be deducted. [the self-employment net profit amount will be calculated using the same deductions that are] The expenses must be business expenses allowed under federal income tax rules.

(6) Items such as personal business and entertainment expenses, personal transportation, purchase of capital equipment, and payments on the principal of loans for capital assets or durable goods, are not business expenses.

(7) For Family Medicaid, the Department shall deduct child-care costs, and the costs of providing care for an incapacitated adult who is included in the Medicaid household size, from the earned income of clients working 100 hours or more in a calendar month. A maximum of up to $200.00 per month per child under age 2 and $175.00 per month per child age 2 and older or incapacitated adult, may be deducted. A maximum of up to $160.00 per month per child under age 2 and $140.00 per month per child age 2 and older or incapacitated adult, may be deducted from the earned income of clients working less than 100 hours in a calendar month.

(8) For Family Institutional Medicaid, the Department shall deduct child-care costs from the earned income of clients working 100 hours or more in a calendar month. A maximum of up to $160 a month per child may be deducted. A maximum of up to $130 a month [shall be]is deducted from the earned income of clients working less than 100 hours in a calendar month.

(9) Earned income paid by the U.S. Census Bureau to temporary census takers [shall be]is excluded for any family Medicaid programs that use a percentage of the federal poverty guideline as an eligibility income limit, and for determining eligibility for 1931 Family Medicaid.

(10) Under 1931 Family Medicaid, for households that pass the 185% gross income test, if net income does not exceed the applicable BMS, the household [shall be]is eligible for 1931 Family Medicaid. No health insurance premiums or medical bills [shall be]are deducted from gross income to determine net income for 1931 Family Medicaid.

(11) For Family Medicaid recipients who otherwise meet 1931 Family Medicaid criteria, who lose eligibility because of earned income that does not exceed 185% of the federal poverty guideline, the state shall disregard earned income of the specified relative for six months to determine eligibility for 1931 Family Medicaid. Before the end of the sixth month, the state shall conduct a review of the household's earned income. If the earned income exceeds 185% of the federal poverty guideline, the household [will be]is eligible to receive Transitional Medicaid following the provisions of R414-303 as long as it meets all other criteria.

(12) After the first six months of disregarding earned income, if the average monthly earned income of the household does not exceed 185% of the federal poverty guideline for a household of the same size, the state shall continue to disregard earned income for an additional six months to determine eligibility for 1931 Family Medicaid. In the twelfth month of receiving such income disregard, if the household continues to have earned income, the household [will be]is eligible to receive Transitional Medicaid following the provisions of R414-303 as long as it meets all other criteria.

 

R414-304-13. Family Medicaid Filing Unit.

This section provides criteria governing who is included in a family Medicaid household.

(1) The Department adopts 42 CFR 435.601 and 435.602, 2001 ed., 45 CFR 206.10(a)(1)(iii), 233.20(a)(1) and 233.20(a)(3)(vi), 2001 ed., which are incorporated by reference.

(2) For Family Medicaid programs, if a household includes individuals who meet the U.S. citizen or qualified alien status requirements and family members who do not meet U.S. citizen or qualified alien status requirements, the Department includes the ineligible alien family members in the household size to determine the applicable income limit for the eligible family members. The ineligible alien family members do not receive regular Medicaid coverage, but may be able to qualify for Medicaid that covers only emergency services under other provisions of Medicaid law.

([2]3) Except for determinations under 1931 Family Medicaid, any unemancipated minor child may be excluded from the Medicaid coverage group, and an ineligible alien child may be excluded from the household size, at the request of the specified relative responsible for the children. An excluded child [shall be]is considered an ineligible child and [shall not be]is not counted as part of the household size for deciding what income limit [will be]is applicable to the family. Income and resources of an excluded child [shall]are not [be ]considered when determining eligibility or spenddown.

([3]4) The Department [shall]does not use a grandparent's income to determine eligibility or spenddown for a minor child, and the grandparent [shall not be]is not counted in the household size. A cash contribution from the grandparents received by the minor child or parent of the minor child is countable income.

([4]5) Except for determinations under 1931 Family Medicaid, if anyone in the household is pregnant, the unborn child [shall be]is included in the household size. If a medical authority confirms that the pregnant woman will have more than one child, all of the unborn children [shall be]are included in the household size.

([5]6) If a child is voluntarily placed in foster care and is in the custody of a state agency, the parents [shall be]are included in the household size.

([6]7) Parents who have relinquished their parental rights shall not be included in the household size.

([7]8) If a court order places a child in the custody of the state, and the child is temporarily placed in an institution, the parents shall not be included in the household size.

([8]9) If a person is "included" or "counted" in the household size, it means that that family member [shall be]is counted as part of the household and his or her income and resources [shall be]are counted to determine eligibility for the household, whether or not that family member receives medical assistance. The household size determines which BMS income level or, in the case of poverty-related programs, which poverty guideline income level [will apply]applies to determine eligibility for the client or family.

 

KEY: financial disclosures, income, budgeting

2004

Notice of Continuation January 31, 2003

26-18-1